Thailand signs $40m trade deal with RI

Thailand signs $40m trade deal with RI

Dow Jones, Bangkok

Thailand expects more barter deals involving Thai rice and
Indonesian goods after signing a memorandum of agreement Friday
to exchange 200,000 metric tons of Thai rice for Indonesian goods
worth US$40 million, Deputy Prime Minister Pitak Intrawitayanunt
said.

Pitak and Thailand's Prime Minister, Thaksin Shinawatra, along
with Indonesian Minister of Industry and Trade Rini MS Soewandi,
were in Bangkok Friday as witnesses at the signing ceremony
involving the exchange of 200,000 tons of 15 percent broken Thai
rice with Indonesian goods comprising an aircraft, cargo train
carriages and ammonia, which is used as a raw material for
fertilizer.

As reported, the deal is valued at $40 million, with $16
million for an aircraft that will be used for agricultural
purposes, $7 million for the train carriages and the balance for
the ammonia. The selling price of the Thai rice isn't yet known.

Indonesia expects delivery of the Thai rice in July or August.

"Indonesia's rice import demand is quite big this year,
possibly up to one million tons...(Indonesia) might also want to
import more rice for a security stock" in addition to fulfill
domestic consumption," Pitak said.

He said relevant authorities from the two countries will work
things out to see whether they need to exchange more of the
goods.

Pitak said he expects more exchanges, adding that transaction
through exchanges instead of cash payment will help boost rice
exports from Thailand to Indonesia.

Rini said Indonesia may want to import around 700,000 tons of
rice this year. However, a more accurate estimate will be seen
probably in the third quarter of this year, she told Dow Jones
Newswires.

"We have to look at our harvest...we will see a clearer
picture (of the need for rice imports) probably in the third
quarter," Rini said.

Thailand is the world's largest rice exporter. It exported a
record high of nearly 7.55 million tons in 2001.